Steps Needed to Avoid Gaps, Double Coverage as Medicaid Enrollees Make ACA Transitions

It’s envisioned that under the Affordable Care Act (ACA), persons at lower income levels will shift between different types of coverage as their job status changes. In a good year, a family might be in a cheaper plan on one of the exchanges. But in a weaker economy—when hospitality jobs or construction work is harder to find—families or individuals that depend on this type of work might drop down to Medicaid managed care or even traditional Medicaid.

The ability to move seamlessly between coverage types is something CMS knows is important; it’s sought changes to Medicaid managed care rules to allow for more unified marketing with this movement in mind.

With transitions still built on the old system, a study by the Government Accountability Office (GAO) finds that opportunities for gaps remain. A report released today highlights the potential for gaps in coverage when one plan runs out before its replacement begins, as well as the potential for double coverage for brief spells.

Coverage gaps can occur in states with Medicaid expansion, when persons at lower income levels might move between traditional Medicaid and expansion coverage, or in any state when a person moves between any form of Medicaid and a plan on the exchanges.

GAO conducted an examination in 8 states—6 that had expanded Medicaid and 2 that had not—and found that that those transitioning from Medicaid to private coverage on an exchange might lose coverage before the end of a month. This might cause some to forgo care.

So far the data regarding such transitions are limited, but the GAO warns that there’s potential for these numbers to grow. Their report on data from 3 states—Kentucky, New York, and Washington state—found these individuals accounted for between 7.5% and 12.2% of exchange coverage enrollment and less than 1% of Medicaid enrollment in those states.

CMS has started taking steps in 34 states using the federal exchange to eliminate the potential for coverage gaps. But the potential for duplicate coverage remains, and GAO found examples as well as existing vulnerabilities. These are:

· There were some vulnerabilities in methods used to block people from keeping their exchange coverage after being found eligible for Medicaid. That’s because those who gain eligibility through a state application process might not get a notice that it is their responsibility to end exchange coverage.

· Additionally, there are weaknesses in preventing those with Medicaid coverage from enrolling on the exchanges. CMS performs a check before letting people enroll on the exchange, but if the Medicaid application is pending, it might later go through after exchange coverage is processed. And CMS did not perform this check for 1.96 million people who were re-enrolled automatically.

· As of July 2015, CMS had no methods to detect and eliminate duplicate coverage. Generally, CMS did not have ways to transmit this information to states taking part in the federal exchange.

The GAO called for 3 reforms, which HHS agreed were needed: (1) HHS agreed to more routine monitoring of the timeliness of account transfers from states, (2) it agreed to establish a schedule for regular checks for duplicate coverage, and (3) it agreed to develop a plan to monitor the effectiveness of the checks.